GE Aerospace Earnings Set for April 2025 Amid Market Challenges

GE Aerospace (NYSE:GE) is set to report its earnings on Tuesday, April 22, 2025. With a market capitalization of $194 billion, GE has shown operational strength, achieving $39 billion in revenue and $6.8 billion in operating profit, along with $6.6 billion in net income over the past twelve months. Analysts predict the upcoming earnings will yield $1.26 per share on sales of $9.04 billion. The company’s sales outlook remains robust due to its strong aftermarket business. However, potential challenges loom as China reportedly instructs its airlines to pause deliveries from Boeing amid a tariff trade war. This could have negative implications for GE, which manufactures engines for Boeing’s aircraft.

Analyzing GE’s Historical Stock Reactions to Earnings Announcements

For event-driven traders seeking to leverage GE’s earnings report, historical stock reactions provide insight. Over the last five years, GE’s stock has recorded positive returns one day after earnings announcements 58% of the time. The median positive return stands at 4.6%, with the highest one-day return reaching 8.3%. It’s important to understand that this historical data reflects a time frame when GE included its Aerospace, Healthcare, and Vernova divisions.

Traders usually adopt two main strategies around earnings events: First, they analyze historical probabilities to position themselves prior to the release. Second, they review the correlation between immediate and medium-term returns after earnings to inform their subsequent trading decisions. While the actual stock movement depends on how GE’s results align with consensus, these historical trends can guide event-driven strategies. For those seeking less volatility than individual stocks, the Trefis High-Quality portfolio offers an alternative, having outpaced the S&P 500 with returns exceeding 91% since its inception.

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Post-Earnings Return Trends for GE Aerospace

Key insights on one-day (1D) post-earnings returns include:

• In the past five years, there have been 19 recorded earnings data points, resulting in 11 positive and 8 negative one-day (1D) returns. This indicates that positive returns occurred approximately 58% of the time.
• This 58% figure holds steady when evaluating data from the last three years.
• The median return for the 11 positive outcomes is 4.6%, while the 8 negative outcomes have a median of -3.0%.

Further data on observed 5-Day (5D) and 21-Day (21D) returns post-earnings is summarized in the table below.

GE observed 1D, 5D, and 21D returns post earnings

Examining Return Correlations Post-Earnings

A less risky approach, though contingent on correlation strength, is to analyze the connections between short-term and medium-term returns post-earnings. Traders can identify pairs with higher correlations and execute trades accordingly. For instance, if 1D and 5D returns show strong correlation, a trader may go “long” for the next five days following a positive 1D return. Correlation data based on both five-year and three-year history is provided below, with 1D_5D indicating the correlation between one-day and five-day returns.

GE Correlation Between 1D, 5D and 21D Historical Returns

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.